Impact of access to credit on income and food security in Malawi
The paper departs from the standard practice that takes the estimated marginal effects of either the amount of credit received or membership in a credit program as measures of the impact of access to credit on household welfare. The marginal effects of the formal credit limit variable on household w...
| Main Author: | |
|---|---|
| Format: | Artículo preliminar |
| Language: | Inglés |
| Published: |
International Food Policy Research Institute
1998
|
| Subjects: | |
| Online Access: | https://hdl.handle.net/10568/161233 |
| _version_ | 1855525143941480448 |
|---|---|
| author | Diagne, Aliou |
| author_browse | Diagne, Aliou |
| author_facet | Diagne, Aliou |
| author_sort | Diagne, Aliou |
| collection | Repository of Agricultural Research Outputs (CGSpace) |
| description | The paper departs from the standard practice that takes the estimated marginal effects of either the amount of credit received or membership in a credit program as measures of the impact of access to credit on household welfare. The marginal effects of the formal credit limit variable on household welfare, controlling for the credit limit from informal sources as well as the credit demanded from both sources, measure the marginal effects of access to formal credit. The main finding of the paper is that access to formal credit, by enabling households to reduce their borrowing from informal sources, has marginally beneficial effects on household annual income. However, these effects are very small and do not cause any significant difference between the per capita incomes, food security, and nutritional status of credit program members and noncurrent members. Moreover, the beneficial substitution effect reflects only the fact that reduced borrowing from informal sources makes informal loans play a lesser role in the negative impact that borrowing (from formal or informal sources) has on net crop incomes. The marginal effects on household farm and nonfarm incomes resulting from mere access to formal credit (without necessarily borrowing) are positive and quite sizable, but not statistically significant. Land scarcity and unfavorable terms of trade for the smallholders’ farm products remain by far the factors that most constrain per capita household income growth in Malawi. The paper concludes that the necessary complementary resources and economic environment are not yet in place for access to formal credit to realize its full benefits for Malawi’s rural population. |
| format | Artículo preliminar |
| id | CGSpace161233 |
| institution | CGIAR Consortium |
| language | Inglés |
| publishDate | 1998 |
| publishDateRange | 1998 |
| publishDateSort | 1998 |
| publisher | International Food Policy Research Institute |
| publisherStr | International Food Policy Research Institute |
| record_format | dspace |
| spelling | CGSpace1612332025-11-06T06:12:18Z Impact of access to credit on income and food security in Malawi Diagne, Aliou rural population nutritional status credit food security time use patterns The paper departs from the standard practice that takes the estimated marginal effects of either the amount of credit received or membership in a credit program as measures of the impact of access to credit on household welfare. The marginal effects of the formal credit limit variable on household welfare, controlling for the credit limit from informal sources as well as the credit demanded from both sources, measure the marginal effects of access to formal credit. The main finding of the paper is that access to formal credit, by enabling households to reduce their borrowing from informal sources, has marginally beneficial effects on household annual income. However, these effects are very small and do not cause any significant difference between the per capita incomes, food security, and nutritional status of credit program members and noncurrent members. Moreover, the beneficial substitution effect reflects only the fact that reduced borrowing from informal sources makes informal loans play a lesser role in the negative impact that borrowing (from formal or informal sources) has on net crop incomes. The marginal effects on household farm and nonfarm incomes resulting from mere access to formal credit (without necessarily borrowing) are positive and quite sizable, but not statistically significant. Land scarcity and unfavorable terms of trade for the smallholders’ farm products remain by far the factors that most constrain per capita household income growth in Malawi. The paper concludes that the necessary complementary resources and economic environment are not yet in place for access to formal credit to realize its full benefits for Malawi’s rural population. 1998 2024-11-21T09:54:19Z 2024-11-21T09:54:19Z Working Paper https://hdl.handle.net/10568/161233 en Open Access application/pdf International Food Policy Research Institute Diagne, Aliou. 1998. Impact of access to credit on income and food security in Malawi. FCND Discussion Paper 46. https://hdl.handle.net/10568/161233 |
| spellingShingle | rural population nutritional status credit food security time use patterns Diagne, Aliou Impact of access to credit on income and food security in Malawi |
| title | Impact of access to credit on income and food security in Malawi |
| title_full | Impact of access to credit on income and food security in Malawi |
| title_fullStr | Impact of access to credit on income and food security in Malawi |
| title_full_unstemmed | Impact of access to credit on income and food security in Malawi |
| title_short | Impact of access to credit on income and food security in Malawi |
| title_sort | impact of access to credit on income and food security in malawi |
| topic | rural population nutritional status credit food security time use patterns |
| url | https://hdl.handle.net/10568/161233 |
| work_keys_str_mv | AT diagnealiou impactofaccesstocreditonincomeandfoodsecurityinmalawi |